No-deal Brexit is 'crazy': Hammond warns UK 'can't afford' to crash out of the EU and Business Secretary says it could 'destroy' parts of the economy - as ministers threaten to QUIT if May tries to push it through

Theresa May is desperately scrambling to get her Brexit deal through Commons

The PM says no deal or no Brexit are possible outcomes if her plan is blocked

Business Secretary Greg Clark warns that a no-deal outcome would be 'crazy'

Senior MPs being briefed by Cabinet Office officials on consequences of no deal

Ministers stepped up no-deal Brexit warnings today, saying it would be 'crazy'.

Chancellor Philip Hammond told MPs during the latest stage of debate on Theresa May's deal that he does not 'believe we can afford the economic costs of a no deal Brexit'.

Business Secretary Greg Clark today warned that failing to reach agreement with the EU would risk 'destroying' crucial parts of the economy.

It is understood that ministers are ready to quit if Mrs May tries to switch to no-deal if she loses the vote on her deal next week. One Cabinet source said it was 'not an acceptable option'.

The incendiary warnings came as Mrs May scrambles desperately to save her Brexit deal from what looks like certain defeat next week.

She said this morning that killing off her plan could result in no-deal, or no Brexit at all.

But Mr Clark is thought to be among a group of ministers who would revolt if there is a danger of a chaotic departure from the bloc.

As the government turned up the heat, senior MPs and former ministers on the privy council - who are entrusted with confidential information - were called to the Cabinet Office for briefings on the consequences.

Chancellor Philip Hammond told MPs during the latest stage of debate on Theresa May's deal that he does not 'believe we can afford the economic costs of a no deal Brexit'

Business Secretary Greg Clark (pictured today) said failing to reach agreement with the EU would risk 'destroying' crucial parts of the economy

Brexiteers slammed the sessions at the Civil Contingencies unite as an attempt to 'spook' opponents of Mrs May's plan, and insisted no-one would be fooled by them.

But in an interview on Sky News this morning, Mr Clark said crashing out would cause massive damage to manufacturing and trade across the Channel.

He said it would 'destroy the foundation of the success of some of our most brilliant industries'.

'It would be crazy to disrupt at a time of great prosperity for some of these industries,' he said.

Opening the third day of debate on the deal, Mr Hammond said: 'I have observed this process at close quarters for two-and-a-half years and I'm absolutely clear about one thing, this deal is the best deal to exit the EU that is available or that is going to be available.

'The idea that there's an option of renegotiating at the 11th hour is simply a delusion.

'We need to be honest with ourselves, the alternatives to this deal are no deal or no Brexit.

'Either will leave us a fractured society and a divided nation.'

'Only that compromise can bring us back together after Brexit is delivered, and we should remember the lesson of history, that divided nations are not successful nations,' he added.

The Chancellor went on to outline the 'too awful to contemplate' no-deal consequences.

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He said: 'I've heard that we have nothing to fear from no-deal: nothing except a cliff-edge Brexit in just four months' time, the end of frictionless trade with our biggest export market, restrictions on our citizens travelling in Europe, nothing except being the only developed economy in the world trading with the EU on purely WTO terms with no customs facilitation agreements, no data sharing and protection agreements, no approvals regime to allow our industries to trade with their nearest customers and suppliers.'

He said: 'The fact is our economic and trading relationship with the EU has been built over 45 years and during that time our economies have shaped themselves around each other and become inextricably intertwined, supply chains crisscross borders, work forces draw on talent from across the continent.'

'While new trade partnerships with countries outside the EU undoubtedly offer new and exciting opportunities for UK companies, the analysis the Government published last week is clear that the benefits flowing from new FTAs would not compensate for the loss of EU trade from a no-deal exit', he added.

Meanwhile, Thames Water has warned of a no-deal Brexit threat to clean water and confirmed talks with the Government to safeguard supplies.

Chief executive Steve Robertson said the group is 'working closely' with the department for Environment, Food and Rural Affairs (Defra) as the industry tries to ensure it has enough supplies of chemicals to treat drinking water.

He said the ability to stockpile many of the chemicals was limited, as many need to be refrigerated.

He stressed there would not be a water shortage, but said the industry was having to take action and might need to call on the Government for back-up support on certain supplies.

Mr Robertson said: 'There's no need for panic, but we do need to recognise there's a threat from the point of view of supply of chemicals.

'It may be that we need some support from the Government.'

He added that the industry is putting in place no-deal contingency plans by maximising storage of chemicals where possible, with firms also planning to 'mutually support' each other.

It comes after reports suggested that Environment Secretary Michael Gove opted to back Theresa May's Brexit deal amid fears over clean water supplies in a no-deal scenario, although he has since given assurances that water will be safe.

A senior source on the Tory Eurosceptic ERG group of MPs said the Cabinet Office briefings for MPs were 'outrageous boll***s', warning that attempting to 'spook grandees is pure bullsh** theatre'.

Theresa May said this morning that killing off her plan could result in no-deal, or no Brexit at all